Business Policy Brief

Question

You are required to write one 6 page single spaced paper on a selected problem in international communication and negotiation. The paper is not a term paper, but a public policy “briefing paper” on an issue.

Use Time New Roman 12 point.

The selected problem or issue: Should countries impose barriers to hinder the import of cultural products and distribution?

This paper should have 3 sections (Please include the heading for each section to help clearly identify which section we are on):
Introduction (1 page): An unbiased summary statement on the history and key elements of the issue. Why is this an issue? There is a conflict here over competing goals, so be explicit and objectives over what the conflict is over!
Policy Options (4 page): Present and explain various policy options in as factually accurate and emotionally dispassionate manner as possible. You are trying to demonstrate that you know the essence of the debate. If you hold the opposite view, it is usually advisable to summarize briefly the gist of this side. Remember, the arguments set the stage for your policy options.
Policy Recommendation (1 page): In this part you indicate and defend your policy position on the debate, weighing the arguments presented earlier Make a definite proposal to deal with the problem you identify, and defend it. Remember, you are presenting your considered judgment.

Important to include:
1. Remember the heading titles to identify the 3 sections
2. Incorporate briefly cite sources at appropriate places in the body of the text. For example. In the body of the text, �Jane Smith of the World Bank reported in a 2004 article that the People�s Federal Democratic Republic of Pipastan is growing 13 percent a year.�
3. Need 8 to 10 academic and policy sources. (Look at world trade organization website on cultural exceptions on trade, foreign policy and foreign affairs might have some articles. Find pertinent articles then track down sources they used)
4. Include all the references

Things to avoid:
1. Caricaturing an opposing view so it is easy to refute.
2. Feelings should be avoided for arguments because of their subjective nature.
3. Do not show bias in arguments.

Answer

Title: SHOULD COUNTRIES IMPOSE BARRIERS TO HINDER THE IMPORT OF CULTURAL PRODUCTS AND DISTRIBUTION?

Contents

Introduction. 2

Policy option 1: promotion of cultural diversity/protection in the context of UNESCO’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions. 3

Policy option 2: The adoption of WTO rules on free trade and exceptions on the handling of cultural products. 5

Policy Recommendation. 7

References. 9

Introduction

The debate about the relationship between trade and culture has a very long history. Today, the World Trade Organization (WTO) and the United Nations Educational, Scientific and Cultural Organization (UNESCO) continue to hold contrasting views in dealing with the highly divisive issue of the relationship between trade and culture. Different countries and interest groups hold different views regarding how cultural products such as books, radio content, and films should be distributed. On one side of the debate, the argument made is that cultural products should be treated differently from items such as cotton and rice. They argue that barriers on import of these products should be introduced for purposes of cultural security. People from the other side of the argument insist that trading activities involving cultural products should be allowed to take place without any barriers since cultural products are items of trade just like any other.

At the same time, the process of creating global awareness on the need to establish and maintain cultural security is ongoing. Many countries of the world feel that it is important for this awareness to continue being created since it affects the way trade relations are conducted. They support the practice of protecting the cultural heritage of individual countries by imposing barriers to hinder the importation and distribution of cultural products such as newspapers, books, performances, films, TV programs, and electronic publications. Others vehemently oppose this view.

            Different countries have adopted different strategies for the imposition of barriers on imports of cultural products. For example, in 2005, Hong Kong, the Hong Kong Trade Development Council (HKTDC) issued a business alert outlining efforts to strengthen the various institutions responsible for handling administrative aspects relating to the importation of cultural products.[1] In this statement, the HKTDC reiterated that the state of Hong Kong requires all businesses that engage in the importation of cultural to obtain operation permits and to operate in compliance with an elaborate licensing system targeting such businesses.

One of the causes of conflict over how to handle cultural products is the existence of competing goals and vested interests. UNESCO has already come up with the Agreement on the Importation of Educational, Scientific and Cultural Materials. States parties to this agreement are forbidden from applying any custom duties or imposing any barriers aimed at hindering the importation of cultural products. However, in earlier negotiations, WTO members came up with what seemed to UNESCO to be very disappointing outcomes; they recommended things such as an evaluation of all possible solutions, the use of the WTO dispute settlement mechanisms, the introduction of an agreement outside the context of the WTO, and the introduction of reforms that achieve a balance between cultural policy objectives and liberalization of trade. In other words, the conflict is over cultural security/diversity on the one hand and trade liberalization/free trade on the other.

The competing objects are best captured in UNESCO’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions that was adopted in 2005 on the one hand and the WTO’s Doha Round on the other. The aim of this paper is to provide an answer to the issue of whether countries should impose barriers to hinder the import of cultural products and distribution. In answering this question, different policy options are presented. Finally, a definite proposal is presented and defended as a platform for resolving the ensuing conflict.

Policy option 1: promotion of cultural diversity/protection in the context of UNESCO’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions

            In this policy option efforts are being made to facilitate equitable exchange of information among all nations. To promote this goal, the concept of New World Information and Communication Order (NWICO) has been introduced.[2] This argument also influenced the establishment of the Convention on the Protection and Promotion of the Diversity of Cultural Expressions, which is also commonly referred to as the UNESCO Diversity Convention. A major objective of the UNESCO Diversity Convention was to create a safe haven for cultural policies by protecting them against WTO disciplines.[3] At the same time, it contributed to efforts aimed at reconciling between liberal trade rules and states’ rights to protect cultural products that are domestically produced.

            The raging debate has been on whether it is right for a state to intervene in cultural markets with a view to promote cultural diversity. It also brought into the limelight the issue of the immense power wielded by some communications industries especially in the developed world.[4] A good example is the internet, which continues to be dominated by US communications companies. Since the internet is only available in only a few languages, concerns have been raised regarding its role as a threat to cultural diversity. On the other hand, there is a concern that international trade rules imposed by the WTO may constrain the ability by states to impose measures such as foreign ownership limits, subsidies, and quotas with a view to protect local cultural industries.

            The overarching goal of the UNESCO’s Diversity Convention is to facilitate the protection and promotion of diversity of cultural expressions.[5] It outlines ways in which the goal of cultural diversity can be realized. Cultural expressions are defined as those products with cultural content that are made using the creativity of groups, individuals, and societies. A lot of emphasis is on the symbolic meaning attached to each of these cultural products. In pursuing this objective, UNESCO has been acting in accordance with other international resolutions and declarations. One of these declarations is the Universal Declaration on Cultural Diversity, which was adopted in 2001. According to this declaration, culture is a distinctive feature of any social group or society.

            In this policy option, it is assumed that endangered cultures should be protected against the threat of loss or extinction. The ideal phenomenon based on the Diversity Convention is one where an ideal environment is created for different cultures to flourish. However, a major problem is that the notion of cultural extinction is very problematic. Some countries may wrongfully claim that their cultures are faced with a threat of extinction. On the basis of such a claim, such countries may impose protectionist measures in international trade.

            It is extremely difficult to provide a strong case for intervention by a state on basis of a threat of cultural extinction. This is because it is not clear what constitutes cultural extinction. The fuzziness of this concept is reinforced by the notion that contemporary cultural forms are mutually dependent, such that larger cultural ecosystems can be destroyed if one distinctive cultural practice becomes extinct. The best way to resolve this problem is to provide evidence for such claims. If such evidence was to be provided, it would be in the interest of all countries to contribute towards the protection of cultural diversity in all countries.

            In this policy option, no constraints are imposed on states in terms of the measures that they can put in place to regulate the way cultural products are imported and distributed.[6] As long as fundamental human rights and freedoms are safeguarded, states are allowed to import or export cultural expressions. At the same time, the conventional view is that all measures necessary should be undertaken to ensure that the cultural rights of indigenous peoples and minorities are safeguarded. The impression in this case is that barriers on import and distribution of cultural goods may be imposed if that is what it takes a country to protect the cultural rights of minority groups.

            Opponents of restrictions and barriers to the importation of cultural products argue that a country may lose out in terms of educational goals. This argument is based on the inherent relationship between culture and education. It is widely assumed that awareness of different cultures increases the educational exposure of citizens in a country. The imposition of barriers the importation of cultural products may hinder this exposure. In this case, it may become difficult to balance between the need to create the right environment for people of all countries to achieve the goal of cultural expression on the one hand and global cultural interactions on the other.

This policy option is permissive in terms of the measures it would allow a state can adopt in order to protect cultural diversity. This means that a state can even impose barriers to stop certain cultural products from entering the country if the presence of such products jeopardizes the future and survival of local cultural expressions. This proposition seems unproblematic until the exporting country accuses the destination country of promoting protectionist practices that are against the spirit of free trade. In such a case, it may be necessary for the matters to be subjected to the mediation process outlined in UNESCO’s Diversity Convention. At this point, the right question to ask would be whether UNESCO is capable of resolving such disputes amicably.

In the spirit of maintaining this permissiveness, this policy option creates a scenario where states are free to introduce any market intervention they deem necessary. However, this strategy may not succeed in the long run because some states may end up introducing protectionism in all trade relations in the guise of protecting cultural diversity. Such countries may ultimately reclassify non-cultural products as cultural products, thereby jeopardizing the principles of free trade that are being promoted by the WTO. At this point, it would be necessary for WTO’s rules on the importation of cultural products to be adhered to in order to avoid unnecessary conflicts among states.

The permissive approach adopted in this policy option also seems problematic because it is shroud in ambiguity and vagueness. In matters of international trade and cultural exchanges, it is imperative that limits are imposed on the extent to which states can introduce market intervention mechanisms and the form that these interventions should take. Actions aimed at providing further specification would create a scenario where cultural industries are accorded ample space to thrive in today’s world of globalization. They would also facilitate the emergence of a global cultural regime where means of cultural production and distribution are not constrained by unnecessary fears about extinction of cultural minorities.

Policy option 2: The adoption of WTO rules on free trade and exceptions on the handling of cultural products

The second policy option is one that is founded on the WTO regime. As its core mandate, the WTO has been instrumental in establishing rules that promote free trade. The WTO recognizes the special place of culture and the need to take special care whenever cultural products become a subject of trade interactions at the international level. In such cases, the WTO recognizes the need to introduce exceptions. Nevertheless, the WTO remains stricter and less permissive than UNESCO Convention’s requirements.[7]

            Many people who support the WTO’s rules argue that the dominance of the US media industry, if left unchecked, would threaten the existence of non-American cultural goods. They argue that it would be extremely difficult for local cultural products to be traded on a level ground within those countries where the American audio-visual industry has become dominant. Such dominance would translate into a scenario where all doors are closed to cultural goods originating from other countries. In the face of such frustration, the best fallback plan for these countries would to impose barriers in their home countries to prevent cultural products from dominant countries from entering the local market. Such a scenario raises serious questions regarding the nature of the contemporary trading system, and that is where the role of the WTO comes in.

            WTO’s predecessor was General Agreement on Tariffs and Trade (GATT). GATT recognizes that contracting parties may deviate from standard trading practices in regards to cultural products. For example, this organization has established a special framework for handling films.[8] This same approach has been adopted by OECD (Organization for Economic Co-operation and Development) countries. In this case, member countries are allowed to introduce subsidies to boost the production of cultural goods for export while at the same time imposing barriers on the importation of cultural products.

            The rule-based regime of the WTO is better than the permissive one recommended by UNESCO because it creates a clear framework for handling trade issues that extend beyond the realm of multilateral agreements. For example, Canada and the United States have already undertaken to engage in substantial liberalization of trade relations that touch on cultural expressions.[9] In this arrangement, the US has already expressed its willingness to grant special treatment to cultural goods, recognizing that their importance transcends all commercial interests.[10] This move led to the formation of Canada-United States Free Trade Agreement (CUSFTA). CUSFTA’s provisions take care of concerns of the two countries regarding cultural products without necessarily affecting the way these countries relate with the WTO. Such an approach is highly attractive because it creates ample room for bilateral relations that address subtle issues may not be captured fully in the context of the more expansive WTO regime. Moreover, such bilateral relations on issues of cultural goods create excellent platforms for dispute resolution.

            A major concern raised in the context of the WTO regime and the rules it provides for cultural protection during trading activities is that the need to conserve local culture is not a sufficient basis for the strengthening and expansion of various international legal protection efforts.[11] Critics who maintain this position cite empirical evidence and historical experience, both of which show that international legal enforcement of such legal protections has been ineffective in preventing cultural evolution and transformation. The same case applies to protections that have been introduced in various countries at the national level. The argument in this case is that the economically distortive and trade-restrictive measures introduced by the WTO over the years do not form a dependable platform for the preservation of local cultures and traditions. On this basis, the critics cast doubts upon the rationale for introducing cultural exception in the current international trade regime in general and culture law in particular.

            Nevertheless, in today’s high-stakes world of competing business interests, international regulation in the context of the WTO always emerges as the ultimate deal-breaker as far as the cultural preservation debate is concerned. This view is supported by the overwhelming number of disputes relating to cultural products that have been forwarded to the dispute settlement system of the WTO for adjudication.[12] The WTO is the ideal place where trade liberalization meets cultural diversity and preservation.[13]

             The limelight turns to WTO whenever different main issues arise in relation to rules and exceptions that affect cultural products. Two main issues are best resolved in the context of the WTO: international negotiation and international litigation. In international negotiations, different countries can come up with a multilateral system governing the imposition of barriers and incentives with a view to regulate the importation and exportation of cultural goods. Through such a system, member states can agree on issues such as tariffs, issuance of licenses, protection of intellectual property, as well as rights and obligations that apply to all WTO members. The outcome of such negotiations will play a critical role in determining the nature and scope of statutory protection for cultural products for many years to come. Therefore, unlike the UNESCO Convention, the WTO regime offers real prospects of long-term solution on how to deal with issues arising from the importation and distribution of cultural products in today’s globalized world.

            In international litigation, attention should be on the role of the WTO in dispute settlement. By virtue of being permissive in its recommendations, the UNESCO Conventions fails to create an ideal platform for international litigation. The need for litigation arises whenever components of laws enacted by regional bodies are found to be inconsistent with WTO’s rules on cultural products and intellectual property rights. Unfortunately, this has become a common phenomenon in the contemporary world; the cultural backdrop of international trade relations tends to be ignored.[14] Through international litigation, efforts can be made to create mechanisms for protecting national culture, local traditions, and cultural diversity. These measures may range from granting of temporary monopolies in the sale of cultural products to the establishment of permanent communal rights.

Policy Recommendation

            In the discussion provided in this paper, it is evident that the choice is between two policy options: the UNESCO Convention and the WTO rules. The UNESCO convention’s core objective is to promote cultural diversity/security. On the other hand, WTO rules seek to promote trade liberalization in such a way that exceptions for the handling of cultural products are created. The UNESCO Convention adopts a permissive in terms of the policies that states can adopt to promote cultural diversity. It allows countries to impose barriers on the importation and distribution of cultural products as long as this does not violate fundamental human rights and freedoms. Moreover, the Convention does not outline a platform for dispute resolution.

            In contrast, the WTO rules are elaborate on the specific actions that states should undertake in regards to protection of cultural diversity. The rules provide avenues for the introduction of exceptions in regards to the handling of cultural products. Countries are allowed to establish bilateral and multilateral agreements on how they are going to interact in terms of cultural exchanges as well as trading activities involving cultural products. In this case, the bilateral and multilateral relations must be crafted in such a way that they do not affect negatively the ability by other WTO member states to comply with the organization’s rules on trade liberalization.

            It is easier for the policy option suggested by the WTO to be fulfilled in a manner that does not contradict UNESCO Diversity Convention. In contrast, it may be impossible for states to adhere to the Convention’s recommendations without reneging on their commitment to trade liberalization as provided for in WTO law. Therefore, the practical thing to do is to pursue the goal of diversity using WTO’s rules while simultaneously seeking to achieve further progress in those areas where there is compatibility with the provisions of UNESCO’s Diversity Convention.

            Opponents of this policy recommendation argue that the UNESCO Convention establishes a safe haven for elaborate cultural policies while at the same time protecting them from WTO disciplines. However, in reality, it is only in the context of WTO rules and exceptions that lasting solutions to the problems relating to the importation of cultural products can be formulated. Through the international negotiation and dispute resolution systems established under the WTO, member states can agree on issues such as tariffs, issuance of licenses, protection cultural expressions as well as rights and obligations. Moreover, unlike in the case of UNESCO Convention, the outcomes of WTO deliberations ultimately tend to play a central in determining the nature and scope of statutory protection for cultural products for many years to come.

Based on this policy recommendation, countries should impose barriers to hinder the importation and distribution of cultural products. Such barriers should be based on cultural exchanges that are an extension of existing bilateral or multilateral relations. The imposition of these barriers should be based on a mutual understanding that commercial interests do not supersede the importance of cultural protection. Moreover, such market intervention measures should not interfere with the ability by WTO member states to continue with their pursuit of the core objective of trade liberalization.

References

Broude, Tomer. “Taking “trade and culture” seriously: Geographical indications and cultural protection in WTO law.” Journal of International Economic Law 26, no. 4 (2005): 623-692.

Burri-Nenova, Mira. “Trade versus Culture in the Digital Environment: An Old Conflict in Need of a New Definition.” Journal of International Economic Law 12, no. 1 (2009): 17-62.

Footer, Mary. “Trade liberalization and cultural policy.” Journal of International Economic Law 3, no. 1 (2000): 115-144.

Graber, Christoph. “The New UNESCO Convention on Cultural Diversity: A Counterbalance to the WTO?” Journal of International Economic Law 9, no. 3, (2006): 553-574.

Hahn, Michael. “A Clash of Cultures? The UNESCO Diversity Convention and International Trade Law.” Journal of International Economic Law 9, no. 3 (2006): 515-552.

Jaswinder, Singh. “Culture or Commerce? A Comparative Assessment of International Interactions and Developing Countries at UNESCO, WTO, and Beyond.” International Studies Perspectives 8, no 1, (2007): 36–53.

Ling, Wessie. “From “Made in Hong Kong” to “Designed in Hong Kong”: Searching for an Identity in Fashion.” Visual Anthropology 24, no. 1(2010): 106-123.

Pauwelyn, Joost. The UNESCO Convention on Cultural Diversity, and the WTO – Diversity in International Law-Making. Washington, DC: American Society of International Law, 2009.

Smith, Rachael. “The UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions: Building a New World Information and Communication Order?” International Journal of Communication 1, no. 4 (2007): 112-129.

Voon, Tania. “UNESCO and the WTO: A Clash of Cultures.” International & Comparative Law Review 55, no. 2, (2006): 635-652.

Voon, Tania. Cultural Products and the World Trade Organization. Cambridge: Cambridge University Press, 2007.

World Trade Organization. Communication from the European Union and the United States: Contribution to the Work Programme on Electronic Commerce. 13 July 2011, retrieved from www.wto.org/english/tratop_e/serv_e/wkshop_june13_e/w338_eu_us_e.doc  on January 29, 2014.

End Notes

End Notes


[1] Wessie Ling, “From “Made in Hong Kong” to “Designed in Hong Kong”: Searching for an Identity in Fashion.” Visual Anthropology 24, no. 1(2010): 106-123.

[2] Rachael Smith, “The UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions: Building a New World Information and Communication Order?” International Journal of Communication 1, no. 4 (2007): 112-129.

[3] Rachael Smith, “The UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions: Building a New World Information and Communication Order?” International Journal of Communication 1 (2007): 24-55.

[4] World Trade Organization. Communication from the European Union and the United States: Contribution to the Work Programme on Electronic Commerce. 13 July 2011, retrieved from www.wto.org/english/tratop_e/serv_e/wkshop_june13_e/w338_eu_us_e.doc  on January 29, 2014.

[5] Joost Pauwelyn, The UNESCO Convention on Cultural Diversity, and the WTO – Diversity in International Law-Making. Washington, DC: American Society of International Law, 2009.

[6] Michael Hahn, “A Clash of Cultures? The UNESCO Diversity Convention and International Trade Law.” Journal of International Economic Law 9, no. 3 (2006): 515-552.

[7] Michael Hahn, “A Clash of Cultures? The UNESCO Diversity Convention and International Trade Law.” Journal of International Economic Law 9, no. 3 (2006): 515-552.

[8] Tania Voon, Cultural Products and the World Trade Organization. Cambridge: Cambridge University Press, 2007.

[9] Mira Burri-Nenova, “Trade versus Culture in the Digital Environment: An Old Conflict in Need of a New Definition.” Journal of International Economic Law 12, no. 1 (2009): 17-62.

[10] Singh Jaswinder, “Culture or Commerce? A Comparative Assessment of International Interactions and Developing Countries at UNESCO, WTO, and Beyond.” International Studies Perspectives 8, no 1, (2007): 36–53.

[11] Tomer Broude, “Taking “trade and culture” seriously: Geographical indications and cultural protection in WTO law.” Journal of International Economic Law 26, no. 4 (2005): 623-692.

[12] Mary Footer, “Trade liberalization and cultural policy.” Journal of International Economic Law 3, no. 1 (2000): 115-144.

[13] Tania Voon, “UNESCO and the WTO: A Clash of Cultures.” International & Comparative Law Review 55, no. 2, (2006): 635-652.

[14] Christoph Graber, “The New UNESCO Convention on Cultural Diversity: A Counterbalance to the WTO?” Journal of International Economic Law 9, no. 3, (2006): 553-574.

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